Political agenda: what Labour new priorities means for auto, equipment and asset finance

Keir Starmer promised after the King’s speech in July to take the brakes off Britain and put the country on the path to national renewal. Sustained economic growth is needed and Labour plans to achieve it through economic stability; a new partnership with business; a national wealth fund; planning reform and a new deal for working people.

What all this means for the auto, equipment and asset finance industry will be the focus for the AFC Autumn conference on November 26th at County Hall in London

Plus

• Corpoate Members’ (finance providers only) workshop - how to protect your asset finance business from cyber-attack – attendees experience the challenges associated with cyber-attack simulation and learn how to better protect themselves
• Leasing Foundation’s 30 under 30 2024 - winners revealed
• New technology and innovation forum (wheeled assets) – inaugural event lead by Chris Kirby, founder of Tomorrow’s Journey
• Dedicated tech workshops from leading technology providers

Auto Finance

Fixing regulation is now a priority as the Government seeks to discourage interventions that might inhibit investment and growth; while regulators seek to align these financial objectives with non-financial objectives including customer protection and sustainability.

The FLA have welcomed the announcement on 29th July 2024, by Nikhil Rathi, chief executive of the FCA, of a consultation and review of the rules governing financial services. This consultation will seek to identify rules which can be removed or simplified which overlap with Consumer Duty, with the aim of lowering costs for financial services firms, encouraging innovation and helping to support the risk appetite needed to support economic growth.

The BVRLA however express concern over the Department of Transport’s renewed commitment to reinstate the 2030 phase-out deadline for sale of ICE cars. A consultation is expected late September, the detail of which will provide a clearer picture of the direction of travel. Gerry Keaney, BVRLA Chief Executive, said: “The ZEV mandate timetable and 2030 Phase Out target for cars present a major risk unless we see much greater government support to stimulate new and used BEV demand and better charging infrastructure.”. Meanwhile OEMs are signalling their concerns with Renault CEO noting the speed of ramp-up is half what is needed for OEMs not to pay fines; and many manufacturers including Toyota, Ford and GM have announced plans to significantly reduce BEV production targets as consumer demand weakens.

Equipment finance

Labour has put emerging green industries at the heart of its “mission for government”, relying on them to spur economic growth as well as tackle climate change. The party’s election manifesto included a stretching pledge to cut emissions from electricity generation to net zero by 2030 — compared with 2035 under the previous government — en route to a broader economy-wide target of net zero by 2050.

But investors at home and abroad remain unsure whether to push more money into the UK because of concerns about the country’s sclerotic planning system, supply chain problems and skills shortages. For many, the question is whether Labour’s offering can possibly match the huge subsidies on offer in the US through the Inflation Reduction Act. AFC take a look at what is happening in the US and in the EU where the costs of complying with new environmental laws are smothering the EU’s competitiveness.

How should finance companies manage uncertainty around sustainability?

Asset finance

Asset finance sessions will continue its focus on broker-lender interaction as it manages regulatory and technology driven changes.

More details shortly but we plan to involve the main trade associations in discussions including:

• How should the industry encourage best practice in asset finance?
• How can the industry sell itself better – to regulators, customers and to each other?
• How will industry trade associations help solve asset finance’s challenges?

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